Modern retail has long been guided by a powerful premise: the bigger, the better. Retailers, consumers and suppliers all benefited from economies of scale, but over the past 10 to 15 years, the retail store model has evolved. Supply chain process improvements have made it possible to achieve similar or even higher levels of profitability with smaller stores, paving the way for smaller retail chains to expand and take share from larger competitors in many markets. Further complicating retail’s evolution is the shifting global socio-economic landscape: Rising middle class, growing urbanization and coming-of-age Millennials are shaping consumer preferences.

“Perhaps the new retail mantra should be ‘Go small or go home,’ as the ‘Bigger is better’ paradigm has been challenged virtually everywhere,” said Steve Matthesen, president, Nielsen Retail Vertical. “Hyper-localization and specialization are fueling today’s retail growth. As lifestyle and consumption habits change, we’re seeing a structural shift in where consumers shop and what they buy, and some small formats are driving big growth. Mass-market strategies are also losing relevance as consumers look for unique experiences that meet their personal demands.”

So how can retailers stay ahead in the rapidly changing landscape? They can start by assessing how well they’re doing now. What do consumers think about the shopping experience, and how well do they think their needs are currently being met?

For many, grocery shopping is a chore. In fact, nearly half (46%) of respondents around the world say grocery shopping is something they try to spend as little time as possible doing. So what is it about the shopping experience that is particularly unpleasant? Less than half of global respondents (49%) believe their main grocery retailer always or mostly communicates with them in a relevant way. Just over half believe retailers always or mostly understand their grocery requirements (53%) and provide offers they like and value (52%). Globally, retailers are only doing slightly better on the product assortment front: 64% say their main grocery retailer always or mostly carries the items they want.

But sentiment isn’t the same everywhere. Retailers in North America—and, to a lesser degree, Asia-Pacific—seem to be doing a better job than their counterparts in Europe and Latin America. North American retailers particularly stand out when it comes to product assortment and providing valued offers. Roughly three-quarters of North American respondents (74%) say their main grocery retailer always or mostly carries the items they want, 10 percentage points above the global average (64%), and almost two-thirds (64%) say their main grocery retailer provides them with offers they like and value (compared with 52% globally).

From why consumers choose one store over another to the product attributes that are most important in their selection process, the Nielsen global report, Think Smaller for Big Growth, explains how to thrive in the new retail landscape. The report also reviews consumer in-store service preferences and the pricing strategies most desired when the cost for products rise.

Other findings from the report include:

Price is important, but it’s not everything. Globally, consumers rate high-quality produce (57%), convenient location (56%) and product availability (54%) as more influential in store-selection decisions than the lowest price.

Health and wellness is a top priority for consumers around the world, with 67% saying they actively seek products with healthful ingredients.

In-store add-on services that are the most widely available and used by global respondents include banking (42%), fast food (40%), prepared food (40%) and pharmacy (39%) services.

When material costs go up for manufacturers of food and personal care products, a quarter of respondents (26%) say they prefer larger economy sizes with a lower price per serving.

About the Nielsen Global Survey

The Nielsen Global Retail-Growth Strategies Survey was conducted Aug. 10–Sept. 4, 2015, and polled more than 30,000 online consumers in 61 countries throughout Asia-Pacific, Europe, Latin America, the Middle East/Africa and North America. The sample includes Internet users who agreed to participate in this survey and has quotas based on age and sex for each country. It is weighted to be representative of internet consumers by country. Because the sample is based on those who agreed to participate, no estimates of theoretical sampling error can be calculated. However, a probability sample of equivalent size would have a margin of error of ±0.6% at the global level. This Nielsen survey is based only on the behavior of respondents with online access. Internet penetration rates vary by country. Nielsen uses a minimum reporting standard of 60% Internet penetration or an online population of 10 million for survey inclusion.